Method of making distributions from an investment fund

1. A method of administering an investment fund, the method comprising: creating a plurality of shares in the investment fund for sale; providing a managed distribution schedule comprising a plurality of consecutive annual periods, a number of payments to be provided during each of the consecutive annual periods, and a formula for calculating a value for each of the payments; providing an investment strategy for investing in assets to provide funds sufficient to meet the managed distribution schedule, the assets composing an investment portfolio; issuing at least one share to an investor in exchange for funds received from the investor; investing the received funds according to the investment strategy; calculating annually, by a computer programmed to perform such calculations, the value of each of the payments to be provided according to the managed distribution schedule in a selected annual period; providing each of the payments to the investor during the selected annual period, each of the payments in the selected annual period being funded from one or more sources selected from the group consisting of: net income of the assets of the investment portfolio, accumulated undistributed net profits resulting from a sale of any asset of the investment portfolio excluding long-term capital gains, and return of capital; for each of the payments in the selected annual period, calculating, by a computer programmed to perform such calculation, an estimated contribution from each of the one or more sources to the payment; after all the payments in the selected annual period have been provided, designating, by a computer programmed to perform such designations, a first portion of the payments as sourced from the net income and accumulated undistributed net profits resulting from a sale of any asset of the investment portfolio excluding long-term capital gains and a second portion of the payments as sourced from the return of capital, the second portion corresponding to a percentage of the payments; and to the extent the investment fund has realized net long-term capital gains for the selected annual period, providing an additional distribution corresponding to the selected annual period, the additional distribution funded in part from the net long-term capital gains and, in part, from return of capital, where the part sourced from return of capital corresponds to a percentage of the additional distribution, and the percentage of the additional distribution sourced from the return of capital is equal to the percentage of the payments in the annual period sourced from the return of capital, after taking all payments into account.

2. The method of claim 1 , further comprising: for each of the payments in the selected annual period, calculating, by a computer programmed to perform such calculation, the estimated contribution from each of the one or more sources to accumulated aggregated payments for the selected annual period, and reporting to the investor the estimated contribution from each of the one or more sources to the accumulated aggregated payments.

3. The method of claim 1 , wherein the additional distribution is made, in part or in whole, as a capital gain dividend.

4. The method of claim 1 , wherein the additional distribution is made to include an amount equal to the absolute value of the sum of (1) all losses realized in a portion of the selected annual period, (2) any other amount that may be recharacterized as long-term capital gains realized by the fund in the selected annual period, and (3) an appropriate additional return of capital.

5. The method of claim 1 , wherein each annual period of the payment schedule comprises twelve monthly payments and the additional distribution is made in a twelfth month of a selected annual period in the managed distribution schedule or thereafter.

6. The method of claim 1 , further comprising the step of reinvesting the annual distribution back into the fund.